How aggressive should I be?

[Ryan Philpott]

Hi BP! This is my first post and I'm looking for some advice from other people in the business. Currently, I have 3 single family houses as rental properties. I will pay off 1 this summer and am planning on taking the income from that one and paying off another one (should take me about 15 months). Then, pay off the last one. I would consider myself a very conservative investor. By that I mean this: I won't purchase a rental property unless I know I can pay for the note if the house was to go unrented indefinitely. Should I change that mentality? Am I hurting myself in the long run by being too conservative? Or continue with slow and steady? Mainly, how do you decide when to add another property? My bank is offering me a HELOC on the house I'm about to pay off but I just haven't pulled the trigger yet. Thanks in advance for any help!

[Jay Ritchie]

I would think that your answer is based on a number of factors.

The first being your investment goal and the time frame to that goal.

Secondly, your question seems to suggest that you may know your answer. 

How long would you hold the "unrented indefinitely" property? Perhaps you could establish a reserve fund to cover 6 months without rent and create an exit strategy for the property that would kick in...

Do the other properties throw enough cash to help cover one of the properties without rent?

How likely is the Black Swan of all three unrented for an indefinite period?

But back to the first item, what is your investment goal and how long do you have to get there?